Toyota to Combine U.S. Operations in Texas Site

In the past week, there were rumors that Toyota Motor Corp. will be moving its U.S. sales headquarters from California to Texas. Now, the automaker confirmed that it will indeed be relocating, but the move will not only affect its sales and marketing team. Rather, Toyota will be consolidating most of its U.S. operations into a single site.

The world’s largest auto manufacturer will be relocating almost all of its North American operations and processes into a campus in Plano, a suburb located north of Dallas. The site will be headquarters for sales, as well as manufacturing, engineering and finance. The company seeks to move into its new headquarters in late 2017.

There are approximately 4,000 employees who will be based in Plano.

The move from three separate locations into one single headquarters will affect more than 4,000 jobs. 2,000 of these positions are at Toyota Motor Sales U.S.A (TMS) and 1,000 are at Toyota Financial Services (TFS), both of which are based in Torrance, California. Moreover, there are 1,000 positions at Toyota Motor Engineering & Manufacturing North America (TEMA) in Erlanger, Kentucky.

Also affected by the relocation are some employees at Toyota Motor North America (TMA) in New York, whose transition will begin as early as this summer. However, most of the employees will not be moving to the new headquarters until its construction has been completed in late 2016 or early 2017.

The relocation will happen in three waves. In the first one, those most involved with the redesign and relocation will move this fall. The second, which involves overlapping functions that will be consolidated, will start in December 2015. The last wave consists of the move of TMS and TEMA employees in early 2017 as well as that of TFS employees in late 2017.

Toyota North America Chief Executive Jim Lentz said that the idea to have a central North American headquarters was his. The decision to bring together key operations under one roof came after a conversation with Toyota President and CEO Akio Toyoda.

“With our major North American business affiliates and leaders together in one location for the first time, we will be better equipped to speed decision making, share best practices, and leverage the combined strength of our employees. This, in turn, will strengthen our ability to put customers first and to continue making great products that exceed their expectations,” Lentz said in a statement.

“Our goal is to become not a group of dedicated affiliates, but one company — One Toyota,” he said to employees.

Lentz confirmed that the transition will entail not only the relocation of certain positions, but also the creation of new ones.

Toyota will offer full-time employees (and their spouses) a company-paid visit to Plano. Should they decide to relocate in Texas, the employees will get a lump-sum relocation payment from the company.

The auto giant is aware that there will be employees who will refuse to move. When rival Nissan North America moved its headquarters from Gardena, California to Franklin, Tennessee a few years ago, the automaker lost employees. According to the Wall Street Journal, Nissan only retained 32 percent of its workforce after the relocation.